A nation breaks the shackles of a fiat currency

Auroracoin is a cryptocurrency for Iceland. It is based on litecoin and is 50% premined. The premined coins will be distributed to the entire population of Iceland, commencing on midnight 25th of March 2014.

Five years ago, the government of Iceland imposed capital controls, following the collapse of a Ponzi inspired financial system that had issued far more Icelandic kronas than the nation could ever back up through its real economy. These controls were supposed to be “temporary”, but as with so many government actions, they remain in place to this day.

This means that the people of Iceland have, for the past five years, been forced to turn over all foreign currency earned to the Central Bank of Iceland. This means that the people are not entirely free to engage in international trade. They are not free to invest in businesses abroad. The arbitrary use of power this entails and the unsustainable debt of the Icelandic government has created uncertainty and risk in all aspects of commerce. This has had a crippling effect on foreign investment, as foreigners in general avoid investing in Icelandic enterprises, because of the risk of not being able to convert their investment back into dollars or euros.

This means lack of investment and stifled economic growth in Iceland. The Central Bank finances consumption imports with the currencies it confiscates from export companies, in addition to expensive FX loans from the IMF, private bondholders and other countries.

This means that the Icelandic economy is slowly bleeding. The people of Iceland are being sacrificed at the altar of a flawed financial system, controlled by an elite that made astronomical bets supported by the government on behalf of the people and ultimately at the expense of the people.

The devaluation of the Icelandic krona, or the ISK, is not just a temporary phenomenon. The entire history of the currency is one of inflation and devaluation. Since 1960, in just over half a century, the Icelandic krona has lost over 99.5% of its value in U.S. dollars – at a time when the dollar lost 98% of its value relative to gold! At one time during this period two zeros were taken off the currency and new bills printed to replace the stock of bills. Now, the highest denomination is back up to 10,000 ISK, which would have been a million krona bill had the two zeros not been removed.

The M3 money supply in Iceland is in the order of 14 billion dollars. The population is only around 330,000 people, about the population of Santa Ana, California.

Of course, the Icelandic financial system was and is fundamentally no different from the financial system in other western countries. The basic premise of the banking system of the world is the unethical marriage of governments and banks. This unholy alliance is in control of the fiat currencies that people are forced to use in their daily lives. The banks, in effect nothing more than an extension of the government, issue money to fund themselves. If the debt becomes unbearable for the banks, the government bails them out. They are too big to fail, and a domino effect would be triggered if one of them were to collapse.

In recent years, governments have resorted to outright money printing, by allowing its central banks to purchase government bonds, thereby preventing the yield on those bonds from rising to an unsustainable level and threatening the solvency of states.

In essence, the government prints itself out of debt. In Iceland, this was not entirely possible, since the debt was nominated in foreign currency and no external bailout took place.

By printing more of the currency that people are forced to use in their daily transactions, the government is directly attacking the welfare of the very people the politicians claim to be fighting for; the poor. The poor are not in a position to protect themselves, by investing in assets that rise in value (measured in the fiat currency). Their income rises eventually, but the new money is printed into the hands of the select few who have the greatest access to the financial system, not the poor. The only thing they can do is watch their paychecks shrink and their purchasing power decrease with every trillion dollar that is being printed into the hands of the elite.

The power must be taken away from the politicians and given back to the people. Cryptocurrencies are a very important milestone in this fight for liberty. They bring the hope of a new era of free currencies, immune to the meddling of politicians and their cronies.

So, let me introduce to you the new cryptocurrency of Iceland, Auroracoin.

Auroracoin is based on Litecoin, a descendant of the Bitcoin protocol, the foremost cryptocurrency in the world. However, it is started by an “Airdrop” of auroracoins to the Icelandic nation, designed to reach almost every Icelander. This one-time event will create the conditions for Icelanders to start using the currency, by providing them with a start and making them aware of the currency and its possibilities. After the Airdrop, the only way to acquire auroracoins will be through mining and transacting. Auroracoin will mirror the development of Bitcoin in the near to medium term.

The Airdrop will start to take place on March 25th 2014. A national ID database, created by the government will be used for this purpose. Although the thorough registration of the entire Icelandic nation into one database is unfortunate, it creates opportunities to reach a large part of the public through various means. About 330,000 Icelanders will be made able to claim f 31.8 each over the following year.

Developers are encouraged to create tools for Auroracoin to support the adoption of Auroracoin. Such software, e.g. for payments, will help Icelanders start using the currency in their daily lives.

I call on the cryptocurrency exchanges of the world to accept transactions with auroracoins.

The prospect of the adoption of Auroracoin in Iceland is likely to create a price and value for auroracoins before the Airdrop. A higher price may in turn increase the likelihood of the successful adoption and use of Auroracoin by at least a part of the Icelandic population.